Industrial Alliance is Part of the National Drug Pooling Program
As originally announced in our April 23, 2012 communiqué, the members of the Canadian Life and Health Insurance Association (CLHIA) developed an industry wide drug pooling program to help mitigate the financial impact of high cost drugs on fully insured drug plans to ensure the sustainability of such plans.
To govern the national drug pooling program, a separate governing organization, the Canadian Drug Insurance Corporation (CDIC) has been formed. Industrial Alliance is one of the founding members of the governing organization. Over 99% of private group insurance participants will be covered by the drug pooling program.
The national drug pooling program will come into effect on January 1, 2013 and will apply to all fully insured drug plans. ASO, refund accounting, simplified retention accounting and stop-loss drug plans will not be eligible for the program.
Under the national drug pooling plan program, group plan sponsors of fully insured drug plans will be protected from the full financial burden of recurring high cost drug claims by spreading the cost of such claims among all participating insurers.
Commencing January 1, 2013, all eligible groups for the national drug program which are being renewed will be provided with a drug protection pooling statement (EP3 Statement). The EP3 statement will indicate the group’s pooling level and any classes and/or divisions that will be excluded from the pooling due to the plan design. The EP3 Statement will also identify if there are any excluded certificates under the pooling program. You must keep a copy of this certificate in your files.
In most cases, group plan sponsors of Industrial Alliance already benefit from drug pooling. Your drug pooling limit will stay the same under the national drug pooling program. For eligible drug plans the maximum pooling limit will be $25,000.
In Quebec drug costs not covered under the Quebec Drug Insurance Pooling Corporation (QDIPC) will be covered by the national drug pooling program at a threshold of $25,000. As a result, drug plans for Quebec employees, subject to the QDIPC at a pooling level at or below $25,000 (i.e. for group plans with less than 125 certificates covered) will continue to be fully covered by the QDIPC. Larger group plans will now benefit from the national drug pooling program at a level of $25,000.
If you have any questions or concerns regarding this matter, please contact your benefits advisor or your Industrial Alliance group account executive.